Builder Confidence in 55+ Housing Hits Record High
Builders see home-sales gold in a sea of retiring boomers. In a 55+ Housing Market Index where 50 is an optimism-pessimism balance, the index rose to 83 in the 3Q.
WASHINGTON – Builder confidence in the single-family 55+ housing market hit an all-time high in the third quarter, jumping 18 points to 83, according to the National Association of Home Builders’ (NAHB) 55+ Housing Market Index (HMI).
The 55+ HMI measures two segments of the 55+ housing market – single-family homes and multifamily condominiums – and each segment asks if current sales, prospective buyer traffic and anticipated six-month sales for that market are good, fair or poor (high, average or low for traffic).
“We saw 55+ buyers come out in force in the third quarter of this year, driving strong growth in sales at 55+ communities,” says Harry Miller III, chairman of NAHB’s 55+ Housing Industry Council. “Shortages of key building materials are contributing to affordability concerns and delayed construction schedules, although recent declines in lumber prices offer good news.”
All three index components of the 55+ single-family HMI posted gains in the third quarter – and all hit all-time highs.
Present sales increased 16 points to 88, expected sales for the next six months rose 20 points to 90 and traffic of prospective buyers jumped 23 points to 69.
The 55+ multifamily condo HMI increased 20 points to 67 – also a new record level. All three index components also posted increases from the previous quarter: present sales rose 20 points to 70, expected sales for the next six months increased 15 points to 67 and traffic of prospective buyers jumped 24 points to 63.
In addition, all four components of the 55+ multifamily rental market went up in the third quarter: present production increased six points to 62, expected future production rose seven points to 61, present demand for existing units increased 15 points to 76 and future expected demand rose seven points to 71.
“Like the broader housing market, low interest rates and the importance of home are helping to lift market sentiment,” says NAHB Chief Economist Robert Dietz. “The rebound in the stock market has also contributed to demand for the 55+ housing market.”
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